ONGC Videsh forays into Senegal blocks; signs agreements with FAR Ltd

ONGC Videsh Limited (OVL) announced on Wednesday about its entry in Senegalese offshore after signing a definitive binding agreement with Australia’s FAR Limited.

The agreement has been signed to acquire a 13.66 per cent participating stake in the exploitation area of Sangomar field and 15 per cent participating interest in the remaining contract area of Rufisque, Sangomar Offshore & Sangomar Deep Offshore (RSSD) block.

The acquisition includes an upfront consideration of US$ 45 million with customary adjustments including the opening working capital as of January 2020 and the cash calls paid or to be paid from January 2020 onwards until completion. The agreement also includes contingent payments payable annually (capped at US$ 55 million) depending upon the Brent Oil price, the company stated in a press release to BSE.

The total investment involved, including the development cost until the first oil, is expected to be around US$ 600 million.

The acquisition is consistent with the company’s strategic objective of adding high impact exploration and near-term production assets to its existing exploration and production portfolio. 

At 11 am today, the stock of ONGC was trading at Rs 70.90 per share, up by 0.28 per cent or Rs 0.20 per share on BSE, against a 0.21 per cent decline in the benchmark index. The 52-week high is recorded at Rs 140.75 while its 52-week low is Rs 51.80 on BSE.